The SAFEMA Appellate Tribunal ruled that routing demonetized cash through third-party accounts constitutes a benami transaction. This ruling clarifies that cash is considered property under the PBPT Act.
Demonetized Cash and Benami Transactions
The SAFEMA Appellate Tribunal has determined that routing demonetized cash through a third party's bank account, followed by transferring it back, qualifies as a benami transaction as per the PBPT Act. The tribunal's ruling emphasizes that currency qualifies as "property," enabling benami proceedings to commence on the basis of cash transactions.
This decision is pivotal as it expands the interpretation of what constitutes a benami transaction, particularly involving cash. The tribunal clarified that when cash is transferred through intermediaries, it retains its benami character, subjecting the involved parties to potential penalties under the PBPT Act.
Lawyers should advise their clients on the implications of this ruling, especially concerning transactions involving large amounts of cash and third-party accounts. The broader interpretation of cash as property under the PBPT Act necessitates careful scrutiny in financial dealings.
Citations
- SAFEMA Appellate Tribunal (2026) [unreported]
